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Tax Changes Implemented Pay Period 2025-21: MD and OH

DATE: Thursday, October 9, 2025

Please share this information with all impacted employees.

The following tax changes were implemented in Pay Period 2025-21. As a result, employees may see a change in their current tax withholdings. Please note that these tax changes are not applied retroactively and reconciliation may be needed when impacted employees file their tax returns.

State Taxes

Maryland State Income Tax Withholding:

  • The state income tax withholding formula has changed effective July 1, 2025.
  • The Standard Deduction has changed from 15% within a minimum and maximum amount to a flat $3,350 annually.
  • Two additional tax brackets have been added to the state tax tables.
  • The highest tax rate for Maryland state has changed from 5.75% to 6.50%. This change affects the flat tax rate used in the Special Formula for supplemental wages as follows:
    • The Maryland Resident Working in Delaware flat tax rate remains 3.30%.
    • The Nonresident Not Subject to Maryland County Tax flat tax rate has changed from 8.00% to 8.75%.
    • The flat tax rate for all other filers has changed from 5.75% to 6.50%.
  • Datamart Query: Tax State = 24

Ohio State Income Tax Withholding:

  • The state income tax withholding formula has changed effective October 1, 2025.
  • The annual tax table has changed.
  • Datamart Query: Tax State = 39

You may execute Datamart queries to identify employees in affected state taxing areas. For Combined File Ad-Hoc query/analysis of applicable states, add STE Tax State 1 = (Tax State code listed above) or STE Tax State 2 = (Tax State code listed above) to the filter or prompt lines. Another option is the shared Datamart report titled "State Tax Code Report" (State Tax Code Query Now Available | January 18, 2024).

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